I think Mike Mann is one of the most successful domain investors, and he has certainly sold more domain names than just about anyone. For those who don’t know about Mike’s background, you should check out Paul Sloan’s Cnet article for more information about him and his domain industry background.
On Facebook this morning, Mike publicly shared an interesting comment about Estibot, the automated domain name appraisal tool:
“The main tool domain “experts” use in appraising premium .Com domains is called Estibot, which usually dramatically deflates the value of a domain. I sell domains constantly for 10, 20 or even $50,000 that they value in the hundreds, and everything I sell I think is too cheap, often discounted. Other famous domain companies have internal tools to appraise domains that are completely useless also, like Estibot.”
I think Mike owns more of the “brandable” variety of domain names. Some of these domain names are popular phrases or terms that are highly coveted by prospective buyers. You can see an idea of those domain names on DomainMarket.com. From this perspective, Mike is probably right about Estibot. It is difficult to appraise brandable domain names. A domain name can seem to be worth just a few hundred dollars, but a company that really wants (or needs) the name may pay tens of thousands of dollars to secure the domain name.
From my own perspective, I tend to think Estibot has inflated domain name values. In fact, I regularly receive domain name submissions from owners whose prices are significantly higher than what I would spend, and many cite Estibot values as the support for their pricing.
It is interesting to hear people discuss Estibot. Some people, especially buyers, think the valuations are on the high side. Some people also think Estibot values are on the low side. For me, the accuracy of Estibot values mostly depends on whether I am buying or selling!